Vancouver-based Nano One Materials Corp. says it has received $5 million from Natural Resources Canada to scale up battery production at its pilot plant in Candiac, Que., and commercialize its patented process for making cathodes.

Nano One has been working to commercialize its “one-pot process” for making battery cathodes, which it said saves up to 30 per cent on operational costs and up to 80 per cent on energy usage compared with other traditional methods.

“This investment strengthens our path to commercialization and reinforces Canada’s position as a leader in clean-technology manufacturing,” Dan Blondal, chief executive of Nano One, said in a release.

It ties into a mini-wave of battery investment news occurring across Canada, including Volkswagen AG subsidiary PowerCo Canada Inc. starting construction on a gigafactory in St. Thomas, Ont., and Nextstar Energy Ltd. completing the construction of its gigafactory in Windsor, Ont.

Nano One said the investment would allow it to at least quadruple battery production in Candiac to 800 tonnes per year. It has described the plant as its “launch pad,” saying it will demonstrate that its patented production process works so it can license its technology.

It said Japan’s Sumitomo Metal Mining Co. Ltd., which invested $16.9 million in Nano in 2023 for a five per cent stake, is considered a partner in the funding from Natural Resources Canada and will contribute technical support to its efforts.

Nano specializes in lithium iron phosphate batteries, which are considered ideal for grid-scale energy storage systems for several reasons, including lower cost, although they are also used in some electric vehicles (EVs). The company is also working to commercialize nickel-rich batteries that are more prevalent in EVs.

The market for grid-scale batteries for energy storage continues to expand even as EV sales have softened. Orders in the first half of 2025 exceeded all orders placed in 2023 by 17 per cent, according to Benchmark Minerals Intelligence Ltd., a market research firm.

Energy Minister Tim Hodgson, in a speech on Wednesday morning in Toronto, specifically mentioned “grid-scale storage” as part of Canada’s plan to build a low-carbon energy system.

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“I do not think it can be overstated that we meet today at a tipping point,” he said later in the day while delivering remarks to the Atlantic Council Energy Security Summit.

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Hodgson said the line between energy security and national or economic security has disappeared as geopolitical tensions have risen, so Canada must build an energy system that is secure, sustainable and market-based, adding that the government’s goal is to reduce carbon emissions to net zero by 2050.

“We need to focus on delivering to our citizens lower, more predictable energy bills without sacrificing security or climate ambition,” he said. “That means scaling energy efficiency and sharpening market design; accelerating clean, firm and flexible supply; modernizing grids to cut congestion costs; and diversifying fuels and trade so no single shock sets prices.”

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